It’s that dreaded time of year – tax time…again. It’s the season of giving to the IRS. But don’t worry…help is here. In the upcoming series of blog posts, I’ll talk you through the most important topics you need to know about tax time for your small business. In this first post I will share with you these quick small business tax survival basics. These are essentials for you to get a head start on your small business taxes and to survive the upcoming tax season.
- Decisions – Now is the time to make basic but very important decisons. Will you hire a professional tax preparer? Do you need professional help with your small business accounting and bookkeeping? Do you need to hire an assistant to help you get organized? Tax and accounting professionals get very busy at this time of year. The earlier you decide the better so that they devote the time and attention that you need.
- Bookkeeping – Did you know that you will be 75% done with what you need to get ready for your small business taxes if your small business accounting and bookkeeping is updated and reconciled for all of the past year’s transactions. Using small business accounting software is the best way to begin getting your small business bookkeeping under control. See my previous blog post on the top small business accouting software programs.
- Recordkeeping – Many small business owners think that they have to spend hours to get all of their small business records organized in order to complete their tax return. The reality is that although there are some key records that you need, the most important information you need will come from your bookkeeping (as mentioned above). However, that doesn’t mean that you shouldn’t keep track of records and receipts. If you are audited by the IRS, you need to provide them with your records in order to show evidence of our business income and expenses. Organizing your records is a good project to delegate to an assistant.
- Get started now – the worst thing you can do at tax time is to put it off or to file an extension. The IRS does not go away and neither does your responsibility to file your taxes. The best thing to do is to start now, schedule consistent but short blocks of time to work on your taxes – this way it will be more tolerable, and after you are done, then give yourself a reward – like a massage or a night out at the ball game.
Stay tuned for my continuing series of small business tax survival tips. Also, remember to subscribe to my feed so you can get the latest updates delivered to you hot off the presses.